Law Firm Slater and Gordon said it has today filed the first of its superannuation class action against Commonwealth Bank of Australia under “Get Your Super Back” campaign.
Slater and Gordon’s “Get Your Super Back” campaign was launched on 11 September 2018 to bring back the money of superannuation members through series of class action. It was introduced in the wake of Royal Commission’s public hearings into superannuation and financial services. At that time, law firm estimated that more than one billion dollars of Australian’s super funds have been striped by major banks lining their own pockets.
Under this class action proceeding, Commonwealth Bank of Australia (ASX: CBA) and its wealth management group Colonial First State will be alleged for investing retirement savings of its superannuation members and paying lower than market standard interest rates. It has been told that CBA may have to pay more than $100 million claims to retirees which will include hundreds of thousands of Australians.
However, CBA acknowledged the same in an ASX announcement defense of superannuation class action dated 10 October 2018. Although the bank has given no concrete statement in its defense, it stated that its subsidiary Colonial First State Investments Limited (CFSIL) and CBA will strongly oppose the class action proceedings filed by Slater and Gordon.
This class action was reportedly filed in the Federal Court of Australia by a first applicant Keith Kayler-Thomson and is expected to be followed by several Colonial First State members. Mr. Kayler-Thomson said that its about his retirement savings and he has been expecting prestigious institution like Colonial to act within law.
Ben Hardwick, Slater and Gordon Head of Class Actions, stated that law firm will allege Colonial First State for dumping its members’ super with uncompetitive interest rates offered by its parent CBA. He said that Colonial First State has no reason to support its low rate acceptance from CBA as it could have easily obtained the higher rate from CBA or other banks for the cash-only and related investment options of its members.
It was informed that CBA has been paying as low as 1.25% which is even lower than RBA cash rate of 1.5%. Outlining the members’ loss on lower interest rates, Mr. Hardwick said that if CBA would have been paying just an additional 0.5% per annum to members with $100,000 in cash, the member would have earned extra $2,235 over five years.
The legal watchdog Slater and Gordon said that amount may appear to be small, but it’s a hard-earned money of working Australians which should be given back to the ones it belongs.
Since Australia’s banking sector has been seen in green today, the share price of Commonwealth Bank of Australia edged up by 0.32% to close at $68.970 on 10th October 2018. However, the stock has drastically fallen by 10.38% over the past one year. Today, CBA stock traded at a PE of 12.870 x with market capitalization of $121.7 billion.
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